A case explains how to pay taxes on equity transfer

Company A:

Our company originally had two investors, Honghong and Huohuo. A company is not a natural person. Now Honghong Company wants to transfer all the equity to Huohuo Company, and the transfer is at a premium. How and what kind of tax should the two investors pay? My company's paid-in capital remains unchanged, but the investors now only have Huohuo Company. Fire company, does my company need to pay tax? If so, what tax should be paid and how to pay it?

01 Value-added tax

According to the "Comprehensive Promotion of Business Tax" issued by the Ministry of Finance and the State Administration of Taxation The provisions of Article 1, Paragraph 5, Item 4 of Annex 1 of the "Explanatory Notes on Sales of Services, Intangible Assets, and Real Estate" in "Notice on the Pilot Program of Substituting Value-Added Tax" (Caishui [2016] No. 36)

Financial Products Transfer refers to the business activities of transferring ownership of foreign exchange, securities, non-cargo futures and other financial products. The transfer of other financial products includes the transfer of various asset management products such as funds, trusts, and financial products and various financial derivatives.

Therefore, the above-mentioned case belongs to the transfer of equity of an unlisted company by an enterprise, and does not belong to the transfer of financial products. It is not within the scope of VAT collection and no VAT is paid.

02 Corporate Income Tax

According to the provisions of Article 3 of the "Notice of the State Administration of Taxation on Several Tax Issues Concerning the Implementation of the Corporate Income Tax Law" (Guo Shui Han (2010] No. 79):< /p>

The income from the transfer of equity shall be recognized when the transfer agreement takes effect and the equity change procedures are completed. The income from the transfer of equity shall be the income from the equity transfer after deducting the costs incurred to acquire the equity. When calculating the income from equity transfer, the amount that may be distributed based on the equity from the shareholders’ retained earnings such as the undistributed profits of the invested enterprise shall not be deducted.

Therefore, the income from the equity transfer in the aforementioned case shall be incorporated into Honghong Company in the same year. Among the taxable income, corporate income tax is calculated and paid.

03 Stamp Duty

According to Article 2 of the "Interim Regulations of the People's Republic of China on Stamp Duty" (State Council Order No. 11). Regulations: The following vouchers are taxable vouchers: "...·2. Property rights transfer documents:

According to its attachment "Stamp Duty Tax Item and Rate Table" stipulates: Rights transfer documents include property ownership and copyright , trademark rights, patent rights, proprietary technology use rights and other transfer documents shall be stamped by the holder of the document at a rate of 50,000% of the amount stated. ”

According to the "State Administration of Taxation on Certain Specific Issues with Stamp Duty". Article 10 of the "Notice of Interpretations and Regulations" (Guo Shui Fa [1991] No. 155) stipulates: The scope of taxation on property ownership transfer documents is: documents issued for the transfer of ownership of movable and immovable properties registered by government management agencies. , as well as the documents issued for the transfer of corporate equity.

In summary, in the above cases, the stamp duty should be calculated and paid according to the amount on the documents issued.